McLoughlin linked up with the Saddlers on Sunday and made his full debut for the Dons' League One rivals later that day as they beat Preston 3-1 at Deepdale.
The 21-year-old was drafted in by Walsall after Nottingham Forest recalled Karl Darlow from his loan spell at the Banks's Stadium and he will remain with Dean Smith's side until February 9.
McLoughlin made two appearances as a substitute for the Dons last season and made his full debut for the Milton Keynes club earlier this campaign when he started in the Capital One Cup against Sunderland.
The former Republic of Ireland Under-21 international had loans spells at Lowestoft Town and Stockport earlier in his career.
